Combination of solar and wind, with smart analytics and “big data” could cause electricity costs to plummet
Could big data soon make renewable energy storage free?, Independent Australia 2 August 2016, A new report explores the democratising of renewable energies through the advancement of “big data”.RenewEconomy‘s Giles Parkinson reports.
GLOBAL investment bank Citi is predicting that the combination of near zero-variable cost energy sources such as solar and wind, along with smart analytics and “big data”, may deliver what the nuclear industry promised nearly half a century ago — free energy……
Citi is not the only research institution making such forecasts but it is in sharp contrast to the general public discussion in Australia, which is dominated by those who insist that the old centralised energy system – slow, inefficient and expensive – will not and cannot be replaced by new technologies.
South Australia is now the focus of that debate, and the push-back against wind and solar by conservatives and, of course, vested interests, seeking to protect their sunk assets is striking.
But Australia is already well down the path to this transformation, given its high level of rooftop solar and the fact that it is considered to be the world-leading market for household battery storage and smart software.
Already, it has more than 1.5 million households and businesses with rooftop solar, totalling more than 5GW and many will soon add battery storage. Smart software will allow households and businesses to pool their resources and trade with each other — if regulators allow.
Citi says this “democratisation” of energy could see renewables and distributed energy resources (DERs) proliferate at the local level and that will mean fewer new power plants.
Consumers could eventually “trade” energy with others, in the form of “transactive energy” — a concept that is already being trialled by utilities and community energy groups in Australia.
This, of course, has profound implications for current energy industry business models. Instead of investing in large fixed assets, as they have done for the best part of a century, Citi suggests the utilities of the future will become distribution service platform providers.
The state of New York is already going down this path through its remarkable REV (Reforming the Energy Vision) programme and some analysts want this model adopted in Australia………
Citi says the fundamental technologies of solar panels, wind turbines, converters and energy storage have been around for years but having nearly half or more of total electricity supplied by wind or solar was previously thought to be impossible due to grid integration issues.
But big data and advanced analytics are helping the electric grid to function more seamlessly, enabling wind and solar utilization and penetration rates to rise more sharply and integrating more distributed generation……..
The Citi report (p21) asks:
What does the future of energy look like?
Producers could tap previously stranded assets and do it quickly; utilities could be winners but only if they transform with the times; renewables, despite intermittencies, could operate as smoothly as traditional fossil energy; emissions should be limited as energy demand is optimized and renewables proliferate. Trillions of dollars are at stake.
This is a story of how software will transform a hardware-dominated sector; it is the kind of creative destruction that demands fundamental changes in an entire sector.
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